Which of the following types of loss exposures may be appropriately handled through the purchase of insurance?
I.High-frequency,low-severity loss exposures
II.Low-frequency,high-severity loss exposures
A)I only
B)II only
C)both I and II
D)neither I nor II

Question

Quizplus · Accepted Answer

Low-frequency, high-severity loss exposures are best handled through the purchase of insurance as they pose a significant financial risk if they were to occur. High-frequency, low-severity loss exposures can often be handled through self-insurance or risk control measures.

Which of the Following Types of Loss Exposures May Be